Loyalty
Status
We constantly look for ways to improve how others see us
150 students completed a simple task and were split into two groups and given either positive or negative feedback on their performance. They were then shown either a one-off print or a mass-produced one and asked how much they’d pay for it.
Those given negative feedback were willing to pay almost 4x more on average for the unique print than those with positive feedback, showing how we use consumption to heal our sense of status.
There are multiple ways to elevate brand status:
Form strategic alliances with successful others with whom you share compatible goals (Thorndike, 1920), e.g. Go-Pro and Red Bull.
Develop your core purpose to raise your products’ perceived value (Chernev & Blair, 2015), e.g. Patagonia who “use business to inspire and implement solutions to the environmental crisis.”
Create and control new ways of promoting industry excellence. Dribbble, a platform for design teams to show off their work provides paid-for "Pro Business" status badges to distinguish the best from the rest.
Invest in a tiered loyalty scheme to elevate consumers’ status & brand attachment (Nunes & Dréze, 2006), e.g. British Airways Executive Club.
Conversion
Scarcity
We value things more when they’re in limited supply
There’s a reason this Nugget is #1 in our library.
The concept of Scarcity lies at the core of economics, and greatly influences perceptions of value, status and our competitive desire to attain certain items over others.
Unfortunately, it's also one of the more poorly-applied concepts out there, along with Defaults and Loss Aversion.
Mastering quantity scarcity
An airline stating that there's
“Only 3 seats left” may well be using accurate data and not simply using faux-scarcity to artificially suggest that there's less supply of seats than there actually is.
However, from the user's perspective, the buildup of mistrust around the use of scarcity means cynicism is higher, so one must be careful with information presented.
Similarly, hotel websites telling you that “30 other people are looking at this item” engineer stress to compel people into action without changing supply yet highlighting demand in a manipulative way.
Instead, use quantity scarcity to focus on the craft and high quality of what you're selling.
Make your scarcity feel valuable, not stressful.
Mastering time scarcity
Ensure that any time restriction is highlighted primarily for the purpose of maintaining the quality of your product or service, and not merely to cause stress that could be avoided.
As an example, use time scarcity to launch unique or experimental products that are only available within a particular window (say a week, month or season).
This use of time scarcity is positive and encourages brand exploration, used creatively to highlight your unique value.
There’s a reason this Nugget is #1 in our library.
The concept of Scarcity lies at the core of economics, and greatly influences perceptions of value, status and our competitive desire to attain certain items over others.
Unfortunately, it's also one of the more poorly-applied concepts out there, along with Defaults and Loss Aversion.
Mastering quantity scarcity
An airline stating that there's
“Only 3 seats left” may well be using accurate data and not simply using faux-scarcity to artificially suggest that there's less supply of seats than there actually is.
However, from the user's perspective, the buildup of mistrust around the use of scarcity means cynicism is higher, so one must be careful with information presented.
Similarly, hotel websites telling you that “30 other people are looking at this item” engineer stress to compel people into action without changing supply yet highlighting demand in a manipulative way.
Instead, use quantity scarcity to focus on the craft and high quality of what you're selling.
Make your scarcity feel valuable, not stressful.
Mastering time scarcity
Ensure that any time restriction is highlighted primarily for the purpose of maintaining the quality of your product or service, and not merely to cause stress that could be avoided.
As an example, use time scarcity to launch unique or experimental products that are only available within a particular window (say a week, month or season).
This use of time scarcity is positive and encourages brand exploration, used creatively to highlight your unique value.
146 people were asked to rate identical cookies that were either presented in a jar as scarce or in abundance. They were then asked how likely they would be to want to eat a further cookie.
When scarce, the cookies were rated as more desirable and having a higher value. They were also seen as more valuable when going from an abundant state to scarce than when always scarce.
Scarcity comes in 4 flavors:
Quantity, Time, Access & Rarity.
Control quantity.
To increase perceived value of your product, release it in smaller and diminishing quantities, emphasizing its finite nature.
Restrict time.
When the clock is ticking and we’re overwhelmed, we take mental shortcuts that speed up decision-making.
Motivate customers by emphasizing the limited time remaining in which to act.
Limit access.
Restricting access to your products or services will increase desire and perceived value. Do this selectively for certain features and / or customer segments.
For instance, you might want to design valuable, unique rewards that are only unlocked for very special efforts on the part of the customer.
Branding
Fluency Shortcut
Statements that are easier to understand are more believable
205 people were shown a description of a digital camera printed in a font that was either easy to read (high fluency) or hard (low fluency).
Results found that when easy to read, only 56% delayed choosing the camera, next to 71% when hard. Why? Fluency breeds familiarity, which we value greatly, because it’s unlikely to be harmful (Zajonc, 1968).
Keep it short. Whether for marketing, nudges or political persuading, low syllable, easy-to-conceptualize slogans will feel dramatically more intuitive for consumers. Next to a competing message, they’ll believe the one that’s easier to understand (Schooler & Hertwig, 2005).
Repeat. Repeat. Repeat. The mere act of repeating your message will increase its familiarity, which itself increases the extent to which it’s seen as true (Reber & Schwarz, 1999). Keep it consistent across your team and put it everywhere.
Keep product benefits concise. Consumers actually like a product less the more positive traits they bring to mind (Menon & Raghubir, 2003). This is because they start to associate your product with greater complexity and lower fluency.
